Doubling Down on AGNC alongside an Insider’s $655,000 Bet

Nicholas Vardy

Nicholas Vardy has a unique background that has proven his knack for making money in different markets around the world.
 
You had two big gainers in your Bull Market Alert portfolio, with Standard Pacific Corp. (SPF) jumping 4.90%, and 3D Systems Corp. (DDD) rising 3.90%.

 

 
But you also had some bad luck with last week’s pick, American Capital Agency Corp (AGNC), which hit its stop the day after my initial recommendation. The stock hit its stop intraday last Tuesday, Aug. 7, before making a big recovery on four times normal daily trading volume. You can see the extent of the extreme move in the chart below.

 

 

 

 
Although I rarely do this, I am going to recommend that you buy American Capital Agency Corp (AGNC) this week, once again.

 

 
And I have a very specific reason for doing so.

 

 
As you know, a company’s own top management tends to have the best inside view into the business. So when company officers make a major buy, it’s worth taking notice. The only reason an insider would actually make a big bet on his company by buying stock in the open market is because he expects to make money.

 

 
Last week, on the very day of AGNC’s sharp sell-off, Gary D. Kain, AGNC’s chief investment officer, bought 20,000 shares of AGNC at an average price of $32.75 for a total investment of $655,000. Kain clearly saw an opportunity during Tuesday’s sell-off, and pounced quickly. And based on Friday’s closing price, Kain already managed to earn a tidy profit of $22,800.

 

 
So buy American Capital Agency Corp (AGNC) at market today and place your stop at $29.00. This 14.72% yielder is just too good to give up on. For potentially even bigger upside, I again recommend the December $37 call options (AGNC121222C00037000).

 

Exclusive  Markets Pause for Breath as Three Positions Hit Yearly Highs

Portfolio Update

 

Bank of Ireland (IRE) lost 6.00%. IRE reported earnings last Friday, Aug. 10. Although IRE reported losses (to no one’s surprise), CEO Richie Boucher noted the bank made further progress on its recovery and that its net interest margin should start to strengthen from here. Dipping below its 50-day moving average (MA), IRE is a HOLD.

 

 
National Bank of Greece SA (NBG) closed the week up 2.52% even as Standard & Poor’s lowered Greece’s outlook to “negative.” European Central Bank (ECB) governing council member Christian Noyer said Thursday that he did not envisage a Greek exit from the euro zone. The Greek drama continues and NBG remains a BUY.

 

 
Novo Nordisk A/S (NVO) was flat last week. NVO reported a 29% rise in Q2 net profit and raised its forecast. Net profit for Q2 jumped to DKK5.35 billion ($833 million) vs. DKK4.13 billion ($682 million) year-over-year. That handily beat analysts’ expectations of a net profit of DKK4.87 billion ($804 million). NVO is a BUY.

 

 
3D Systems Corp. (DDD) gained another 3.90%. The bragging rights alone of owning your own 3D printer are not enough to actually drive sales, as you must truly be able to do something with your shiny new 3D printer. In addition to last week’s Cubify® toy robots announcement, DDD announces Cubify® Tags. This new product allows you to design and print your own 3D tags or pendants, right from the comfort of your own home. DDD is a BUY.

 

 
Standard Pacific Corp. (SPF) jumped 4.90%. SPF continued gains last week, after bouncing up from the 50-day MA the week prior. Standard Pacific is moving back up towards its recent $6.66 all-time high. SPF is a BUY.

 

 
Ross Stores Inc. (ROST) dipped 1.41% over the past five trading days. ROST is scheduled to report earnings on Aug. 16 this week, along with several other retailers. July retail sales numbers also come out on Tuesday, and the July consumer price index (CPI) reports on Wednesday. Trading above its 50 day moving average, ROST is a BUY.

 

 
ProShares Ultra Nasdaq Biotechnology (BIB) was essentially flat, adding 0.53%. BIB traded sideways last week, following a pullback from a recent 52-week high. These short periods of “consolidation” normally precede a continuing trend higher — especially given the 50-day MA rising directly beneath. BIB is a BUY.

 

 
 

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